May 31 (Bloomberg) -- Oil rose for a second day in New York,
trimming the biggest monthly decline in a year, after a pump-station leak forced the shutdown of the Keystone pipeline that
carries crude to the largest U.S. storage hub.

Futures climbed as much as 0.9 percent as TransCanada Corp.
closed the link that runs from Alberta to Cushing, Oklahoma,
where New York-traded oil is stored. Prices also gained on
speculation consumer confidence in the U.S., the world’s biggest
crude user, increased to the highest in three months.

“Market participants are looking for more bullish factors
rather than bearish factors as the correction is over,” said
Tetsu Emori, a commodity-fund manager at Astmax Ltd. in Tokyo,
who predicts prices may rise to about $115 to $120 a barrel.
“That’s why the market is focusing on such news even if it’s
not really having a significant impact on supplies.”

Crude for July delivery climbed as much as 89 cents to
$101.48 a barrel in electronic trading on the New York
Mercantile Exchange. It was at $101.45 at 2:55 p.m. Singapore
time. Futures, down 11 percent this month, are set to snap an
eight-month rising streak.

Floor trading was closed yesterday for the U.S. Memorial
Day holiday and transactions will be booked with today’s trades
for settlement purposes.

Brent crude for July settlement on the London-based ICE
Futures Europe exchange climbed as much as 97 cents, or 0.9
percent, to $115.65 a barrel. Yesterday, it fell 0.3 percent to
$114.68, the lowest settlement since May 24. Prices, down 8.4
percent this month, are also set to end an eight-month rally.

Pipeline ‘Issue’

Calgary-based TransCanada shut the 591,000 barrel-a-day
Keystone pipeline after a “an issue with a fitting” caused a
40-barrel oil leak at a pump station, according to an e-mailed
statement from Terry Cunha, a company spokesman. There was no
fault on the pipeline itself, he said.

Crude stockpiles at Cushing were at 40 million barrels in
the week ended May 20, compared with 37.6 million a year earlier,
the Energy Department said last week. Supplies reached a record
41.9 million in the week to April 8.

The Conference Board’s index of U.S. consumer confidence,
scheduled for release at 10 a.m. in New York, will climb to 66.5
in May from 65.4 in April, based on the median estimate of 60
economists surveyed by Bloomberg News. Other reports this week
may show U.S. factory output and job growth slowed while home-price declines accelerated.

Fibonacci Support

Oil in New York is set to finish May trading above a long-term support level on monthly technical charts. Futures remain
above $94.97 a barrel, the 61.8 percent Fibonacci retracement of
the market’s rally from $10.35 in December 1998 to $147.27 in
July 2008, according to data compiled by Bloomberg. Investors
use Fibonacci levels to identify points to buy or sell contracts.

“Heavy long-liquidation has already happened in May,”
said Emori at Astmax. “For the month of June, I think it’s
quite positive.”

Crude is the fifth-worst performer in May among 22
commodities tracked by Bloomberg. Silver is the biggest loser
with a 21 percent drop and orange juice, up 5 percent, is the
strongest of five gainers.

Brent, the European benchmark, traded at a premium of
$13.84 a barrel to U.S. futures. The difference between front-month contracts in London and New York reached a record $19.54
on Feb. 21. It averaged 76 cents last year.

North Africa

Brent has increased 22 percent this year as unrest in the
Middle East and North Africa toppled leaders in Tunisia and
Egypt and spread to Libya, Iran and Syria. In Yemen, the death
toll from an attack on protesters by security forces rose to 57,
with more than 1,000 injured in the city of Taiz, al-Jazeera
television reported yesterday.

Libya’s rebel-leadership council yesterday sought
representation at next week’s OPEC meeting. The country has lost
82 percent of its oil output this year because of protests
against leader Muammar Qaddafi. The 12 members of the
Organization of Petroleum Exporting Countries, which gathers
June 8 in Vienna, pump about 40 percent of the world’s crude.